New Hampshire House passes $11.2 billion state budget proposal largely along party lines

The Republican-led House passed a two-year, $11.2 billion state budget Wednesday that cuts health services for the elderly and people with disabilities, denies state employees a raise and nearly empties the state's rainy day fund, all to avoid major tax or fee increases.

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"It's a balancing act and I think the House produced a budget that will meet the basic needs of the state of New Hampshire," said Republican House Speaker Shawn Jasper of Hudson.

The proposal, which shaves more than $300 million from Democratic Gov. Maggie Hassan's $11.5 billion budget, now heads to the Senate where it is likely to change substantially. House budget writers have been crafting the budget for weeks, but its passage Wednesday largely came down to last-minute wrangling within the Republican caucus over public school funding and fees in the Fish and Game department. The existing state budget is about $10.7 billion.

Hassan sharply criticized the House plan.

"Senate Republicans cannot follow the path of their House counterparts and simply cater to the most extreme members of their party at the expense of common sense and fiscal responsibility," she said in a statement.

A reduction in funds to public schools known as "stabilization grants," which would have cut up to $750,000 to some districts in 2017, threatened to derail the budget until representatives voted to soften the cut by giving districts 90 percent of their existing grants in 2017 rather than the proposed 60 percent.

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A provision allowing the Fish and Game department to set its own fee increases drew criticism from many members of the conservative caucus led by Rep. Bill O'Brien of Mont Vernon. About two dozen Republicans, many of them O'Brien allies, voted against the final budget, but O'Brien himself voted for it and urged his colleagues to do the same.

The budget, O'Brien said, meets the party's pledge to spend responsibly without raising taxes.

"We passed a budget that meets those goals and sets a foundation for limited and responsible government," he said.

Democrats tried unsuccessfully to restore money to the university system, services for people with developmental disabilities and an already negotiated 2 percent raise for state employees. An attempt to accept all of Hassan's revenue options, including increases in the cigarette tax and car registration fees, also failed.

Democrats attacked Republicans for balancing the budget by taking nearly $10 million from the rainy day fund, raiding $50 million from the state's renewable energy fund and cutting nearly $8 million from Hassan's proposal for the community college system. The House budget also gives $76.5 million annually in state aid to the university system, less than the $84 million the system is receiving in fiscal year 2015.

"I consider this a whack-a-mole budget," said Democratic Rep. Susan Ford of Easton. "Take your topic of the day and let's take the money."

The budget bill legalizes the electronic gambling game Keno, which could be placed in bars and restaurants pending approval from the local community, for about $12 million in new state revenue. Senators rejected Keno last year and are also unlikely to support raiding the rainy day and renewable energy funds.

Republican Rep. Neal Kurk, chairman of the finance committee, said budget writers tried to find places to trim wherever possible to avoid large cuts to public schools and the Department of Transportation.

"This was an effort to look under every cushion on the sofa for, as they say, loose change," Kurk said.